supply chain advancement: making the right decisions...making the right decisions the next steps in...

Perfect your

processes

Supply Chain Advancement:

Making the Right Decisions

The Next Steps In Supply Chain Management

Copyright © 2015 LeanCor LLC

Your Presenter: Derek Browning

• Career Focus:

Focused his career on end to end supply chain advancement, including transportation management, logistics network and route designs, PFEP and material flow, ROI assessments, lean cross-dock and distribution center projects and people development

• Currently Responsible For:

Leading LeanCor’s Sales and Marketing team and developing Supply Chain Advancement solutions for LeanCor Consulting customers

• Instructor for Professional Education Programs:

AME, UK Gatton College of Business, Lean Enterprise Institute, Honda

Lean Network

Powered by: Our Company

• Lean Deployment

Executives and Engineers

delivering end-to-end

supply chain advancement

solutions

Our Content Community • Global supply chain

executive leadership

• Organizations embracing

supply chain advancement

and lean principles

• Industries ranging from

automotive to medical

Vice President of Sales and Marketing


Who Is LeanCor Supply Chain Group?

• Lean, supply chain, six

sigma, and leadership

courses that develop

people capability and

problem solving skills

while building a culture of

operational excellence.

Project-based, end-to-

end supply chain

solutions that improve

your processes, reduce

inventory and Total Cost,

and optimize your

network.

Custom, outsourced

transportation, supplier,

and warehouse

management

solutions that optimize

material flow, reduce costs,

and exceed your business

goals.

Advancing the World’s Supply Chains

Trusted supply chain partner that specializes in lean principles to

deliver operational improvement. Three divisions:


LeanCor Customers

http://www.yourlogoresources.com/wp-content/uploads/2012/01/The-Home-Depot-logo.jpg


The Lean Enterprise System

PDCA

Long Term Thinking

Creating Customer Value

The Purpose

Th

e Peo

ple

Learning Organization

Change Agent

“Go See”

Problem Solver

Systems Thinker

Responsibility &

Results

Students &

Teacher

Standardization

Stability

Flow - JIT

Quality at the

Source

Waste Elimination

Customer Focus

Th

e Pro

cess

Respect For

Humanity

Business Strategy

Product Development &

Life Cycle Management

Supply Chain

Sales and Marketing


Organizational Performance • The goal of a business is to maximize customer value, at the lowest

possible total cost, while treating people and the world with respect.

• Overall performance of an organization is reflected as the 10 Rights:

Fulfill the

to the

in the

in the

at the

from the

at the

at the

with the

all within the

• Many organizations turn to

Lean and OpEx activities to

help them increase this value to

customers and reduce total

cost.

• However, many organizations

are not seeing the results they

expect from Lean - OpEx

activities.

• What is Value?

• Why does OpEx fail?


4 Core Functions

• Business Strategy: What is our core purpose? What value do we

create?

• Product Development and Life Cycle Management: What products

and services do we need to develop to deliver that value?

• Sales and Marketing: To what people, in which markets, through

what channels are we going to sell these products and services?

• Supply Chain Management: How are we going to fulfill orders for

these products and services?

Business Strategy Product Development

& Life Cycle

Management

Supply Chain Sales and

Marketing


Supply Chain Advancement

• Business methodology that drives improvements in all parts of a business by focusing on supply chain performance, maturity, and supply chain centric decision making.

• SCA is built on the premise that business decisions are made in all parts of the business; including:

• When determining supply chain implications to these areas, an organization should evaluate: – What is our core purpose? – What value do we create? – What products and services do we need to develop to deliver that value? – To which markets and through what channels will we sell these products and services? – How are we going to fulfill orders?

Business Strategy Supply Chain Product Life Cycle Sales and Marketing

…How will this decision add value or create complexity

and waste in the supply chain?


Business Strategy

Function Decision Consequence

Strategic Decisions M&A Targets + Market Cap - Complexity

Management Decisions

Plant Locations Plant Functions Cost Reductions

Plant & People Roles

+ Lower Costs & Asset Optimization - Revenue & Equity

Erosion

Budget Annual Capex &

Expense Plan +PDCA

-Restricts to MBO


Product Development &

Life Cycle Management Function Decision Consequence

Product Quality Change Orders +Brand Protection

-Manufacturing Cost -Warehouse Flow

New Product Family Launch

Move up or Delay the Launch

+Go to Market Timing

-Space and Variation

Component Selection

100% New Parts +New/Fresh Design

+Functionality -SKU Proliferation


Sales & Marketing

Function Decision Consequence

Promotions Year End

Monthly/Seasonality

+Revenue -Unleveled Flow -Margin Erosion

Packaging Loud Design that

Pops on Shelf

+Revenue and Market Share -Manufacture, Shipping, and Storage Costs

Contracts Favorable Returns

Policy

+Customer Loyalty -Reverse Logistics

-Scrap & Obsolescence


LeanCor Service Awareness

• Business Strategy: Strategy Development

& Deployment

• Product Development & LCM: Inv.

Assessments & Tactical Mgt.

• Sales and Marketing: Sales Strategy &

Playbook &

• Supply Chain Management: Strategic &

Tactical Assessments & Transformations

Business Strategy Product Development

& Life Cycle

Management

Supply Chain Sales and

Marketing

Executive Coaching

Assessments

Transformations


Supply Chain Advancement

SC Goals

Financial | Non Financial

Guiding Principles

Core Processes | SC Centric Decision Making

Management Systems

Present | Past | Future


SCCO Management Systems

How could this business decision create value and enhance performance within

one or more of the Ten Rights dimensions?

What unintended consequences could this business decision create? Will it

create unplanned complexity or other forms of waste in the supply chain?

What planned complexity does this business decision create? What supply chain

systems are required to support this planned complexity?

How will we objectively measure and validate the assumed value or waste

created in the supply chain relative to this business decision?

How will we create and sustain feedback mechanisms within the

supply chain to determine how much value or waste is created?

Encourages employees to consider current and future supply chain

implications when making business decisions.

Do we make supply chain-centric decisions today? What are examples to learn from?


SCA Guiding Principles • Focusing on supply chain performance, which ultimately reduces supply

chain operating costs.

• Focusing on people development and process improvement. Process

improvement includes both value stream improvement and functional

process improvement.

• Imparting a fundamental understanding of supply chain operating and

management principles to all members of an organization.

• Encouraging supply chain-centric decision making within all four primary

functions.

• Enabling supply chain centric-decision making by changing the

organization's management

system to focus on improving

and re-designing supply

chain processes that will

deliver on the Ten Rights.


Guiding Principles Visibility Real time visibility to material and information flow

Value Stream Thinking Internal and external End to End collaboration to manage

total cost

Lead Time Reduction Flow, velocity, pull, JIT, and leveling

Quality at the Source Standardization, error proofing, and first time quality of

core processes

Complexity Management Supply Chain centric decision making to manage planned

complexity

Performance Management Clear targets, PDCA, and continuous improvement


Visibility Real time visibility to material and information flow


Value Stream Thinking Internal and external End to End collaboration to manage Total Cost

The defining characteristic of a system is that it cannot be understood as a function of its isolated components. First, the behavior of the system doesn't depend on what each part is doing but on how each part is interacting with the rest ... Kofman and Senge, 1993


Lead Time Reduction Flow, Velocity, Pull, Just-in-Time, and Leveling

7AM 9AM 11AM 1PM 3PM

Waste

Valu

e

Valu

e

Waste Waste

Valu

e

Valu

e


Lead Time & Ultimate Business

Model Build to Order = No Overproduction…so what’s the problem?

Supply LT

+

<

= Forecast

MLT + OL + < Customer LT = BTO

Supply LT

Customer LT MLT + OL

LT = Lead Time

MLT = Manufacturing Lead Time

OL = Outbound Logistics / Shipping


Quality at the Source Standardization, error proofing and first time quality of core processes

No Controls Direction Standard Work Visual Management Inspection Stop Process Avoidance

PreventionAwareness Detection


Complexity Management

• Leaders will look at all business decisions from a "what will this do in the supply chain” point of view.

• Leaders should always be asking, "how will this business decision result in value or waste in the supply chain?”

• Leaders should always be asking, "how will this business decision impact the rest of the business?”

Supply chain-centric decision making to manage planned complexity


Performance Management Clear targets, PDCA and Continuous Improvement

We Must Add Pressure

1st and 10, Do It Again

Questions? Contact: Derek Browning [email protected]

http://www.google.com/url?sa=i&rct=j&q=pressure+and+diamonds&source=images&cd=&cad=rja&docid=X7GL_wtqJIz6qM&tbnid=QOUBJyERid7oDM:&ved=0CAUQjRw&url=http://followme.org/articles/foundations/comfort/becoming-a-diamond-it-takes-a-lot-of-pressure&ei=-ziRUc6wHpDm9gSvm4GoDw&psig=AFQjCNFjjxVgzLufaOf8swCOOG-a0n2tEQ&ust=1368558183044612

http://fchafir.blogspot.com/

mailto:[email protected]

supply chain advancement: making the right decisions...making the right decisions the next steps in...

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